Roblox (NYSE:RBLX) Stock Price Down 5.2% – Here’s Why

Roblox Corporation (NYSE:RBLX)’s share price dropped 5.2% during mid-day trading on Tuesday . The stock traded as low as $44.90 and last traded at $45.66. Approximately 1,938,404 shares traded hands during mid-day trading, a decline of 84% from the average daily volume of 11,843,800 shares. The stock had previously closed at $48.16.

Wall Street Analyst Weigh In

Several equities research analysts have recently weighed in on RBLX shares. UBS Group reduced their price objective on Roblox from $74.00 to $49.00 and set a “neutral” rating for the company in a research note on Friday, May 1st. Barclays decreased their price target on Roblox from $115.00 to $60.00 and set an “equal weight” rating for the company in a research report on Friday, May 1st. Morgan Stanley restated an “overweight” rating and set a $62.00 price objective on shares of Roblox in a report on Friday, May 1st. Oppenheimer began coverage on shares of Roblox in a report on Friday, May 1st. They issued an “outperform” rating for the company. Finally, Canaccord Genuity Group dropped their target price on shares of Roblox from $140.00 to $80.00 and set a “buy” rating on the stock in a research report on Friday, May 1st. One investment analyst has rated the stock with a Strong Buy rating, twelve have assigned a Buy rating, fourteen have assigned a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, Roblox presently has a consensus rating of “Hold” and an average price target of $87.07.

Roblox Stock Performance

The firm’s fifty day moving average is $53.40 and its 200 day moving average is $70.88. The firm has a market capitalization of $30.85 billion, a price-to-earnings ratio of -29.07 and a beta of 1.50. The company has a debt-to-equity ratio of 2.45, a current ratio of 0.89 and a quick ratio of 0.89.

Roblox (NYSE:RBLX) last released its earnings results on Thursday, April 30th. The company reported ($0.35) earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of ($0.41) by $0.06. Roblox had a negative net margin of 20.69% and a negative return on equity of 277.69%. The company had revenue of $1.44 billion during the quarter, compared to the consensus estimate of $1.74 billion. During the same quarter in the prior year, the firm earned ($0.32) EPS. The company’s revenue was up 43.4% compared to the same quarter last year. On average, analysts predict that Roblox Corporation will post -1.4 EPS for the current fiscal year.

Roblox declared that its Board of Directors has approved a share repurchase plan on Tuesday, May 19th that permits the company to repurchase $3.00 billion in outstanding shares. This repurchase authorization permits the company to reacquire up to 9.5% of its stock through open market purchases. Stock repurchase plans are usually a sign that the company’s board of directors believes its stock is undervalued.

Insider Activity at Roblox

In other news, CAO Amy Marie Rawlings sold 2,895 shares of Roblox stock in a transaction dated Wednesday, May 20th. The stock was sold at an average price of $45.24, for a total transaction of $130,969.80. Following the completion of the sale, the chief accounting officer directly owned 35,238 shares in the company, valued at $1,594,167.12. The trade was a 7.59% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Naveen K. Chopra sold 16,863 shares of the stock in a transaction that occurred on Wednesday, May 20th. The stock was sold at an average price of $45.28, for a total value of $763,556.64. Following the completion of the transaction, the chief financial officer owned 380,758 shares in the company, valued at $17,240,722.24. This represents a 4.24% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders sold 178,453 shares of company stock worth $8,696,984. 10.05% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Roblox

A number of large investors have recently bought and sold shares of the business. Baird Financial Group Inc. increased its position in Roblox by 1.4% during the second quarter. Baird Financial Group Inc. now owns 7,294 shares of the company’s stock worth $767,000 after buying an additional 102 shares during the last quarter. Sunbelt Securities Inc. boosted its stake in shares of Roblox by 58.7% during the 3rd quarter. Sunbelt Securities Inc. now owns 284 shares of the company’s stock worth $39,000 after acquiring an additional 105 shares in the last quarter. Brown Brothers Harriman & Co. increased its holdings in shares of Roblox by 2.8% during the 3rd quarter. Brown Brothers Harriman & Co. now owns 4,042 shares of the company’s stock valued at $560,000 after acquiring an additional 110 shares during the last quarter. Westpac Banking Corp raised its stake in shares of Roblox by 0.6% in the 3rd quarter. Westpac Banking Corp now owns 20,043 shares of the company’s stock valued at $2,776,000 after acquiring an additional 115 shares in the last quarter. Finally, NewEdge Advisors LLC lifted its holdings in Roblox by 1.3% in the 2nd quarter. NewEdge Advisors LLC now owns 10,374 shares of the company’s stock worth $1,091,000 after purchasing an additional 138 shares during the last quarter. 94.46% of the stock is currently owned by institutional investors.

About Roblox

Roblox Corporation operates Roblox, a user-generated online platform that enables people to create, share and monetize immersive 3D experiences and games. The core offering centers on Roblox Studio, a development environment that allows independent creators and studios to design interactive worlds using the company’s building tools and scripting language. Content on the platform spans games, virtual hangouts, branded experiences and live events, all delivered through a persistent social environment.

Roblox’s business model is built around its virtual economy and creator ecosystem.